Updated 8:27 a.m. The Peconic River Hotel, a five-story, 94-room hotel proposed by town square master developer Joe Petrocelli on East Main Street, won site plan and special permit approvals from the Riverhead Town Board Tuesday.
In a unanimous 5-0 vote, the board approved the applications filed by J. Petrocelli Riverhead Town Square LLC for the hotel, planned on a roughly 0.42-acre site at 117-127 E. Main St. The 69,738-square-foot building is proposed to include hotel rooms, retail space, a restaurant, café, hotel lobby and amenities, as well as nine parking spaces on the building’s lower level for hotel staff.
Board members praised the plan as an integral component of Riverhead’s long-sought downtown revitalization, which they say is finally nearing fruition.
Before voting, Council Member Ken Rothwell said the approvals marked another step in the town’s downtown revitalization effort, something he promised he’d work on since taking office.
He said he’d had lunch in a downtown restaurant that afternoon and it was “quite quiet.”
“I just hope that projects like this moving forward will put people in those seats and fill those restaurants, so our businesses can survive,” he said. “This is a path moving forward, and it’s promises kept.”
Council Member Denise Merrifield called the project “a tremendous asset,” saying it would bring people and tourism downtown and help commercial tax revenue.
“This hotel, the beautiful Tapestry Hilton Hotel, would be greatly helping the local businesses in our downtown area,” Merrifield said. She said downtown restaurants, the Suffolk Theater and the Jazz Loft would benefit from visitors staying for a weekend at the hotel.
Merrifield also rejected objections focused on parking. There was widespread community support for the stalled Long Island Science Center proposal planned for the town square site opposite the hotel, she said, and no one raised parking-related objections to that plan.
“I don’t recall hearing one individual complain about the parking that would be a result of that particular entity… not emails, not letters, not at a podium. Not one individual remarked whatsoever about potential parking issues that will be created by such a family entity,” Merrifield said. “Yet many individuals spoke lovingly about that establishment, saying how it will bring thousands and thousands of individuals to our town. So to say that 94 parking spaces is a huge detriment and problem for our town parking is just unpersuasive,” she said.
The hotel site and the rest of Riverhead’s downtown central business district are within the Riverhead Parking District, a special taxing district governed by the Town Board. The district was established in 1967 to provide and maintain parking areas for the benefit of downtown businesses, at a time when downtown was the town’s commercial center.
After retail and commerce shifted to Route 58 and Riverhead’s downtown declined, the town in 2007 began revitalization efforts that incorporated high-density residential development downtown. Since then, the town has not imposed new parking requirements for residential development within the parking district, and developers of apartment buildings and hotels have not had to provide parking for their tenants and guests, relying instead on municipal parking lots.
Critics of the new development, in particular the new five-story buildings allowed by zoning changes implemented beginning in 2007, have focused on public parking they’ve argued is insufficient to accommodate residents in new apartment buildings and has negatively impacted existing downtown businesses.
Those concerns were raised by some speakers during the board’s June 10 hearing on Petrocelli’s applications and were brought up again Tuesday prior to the board’s vote.
Former supervisor Laura Jens-Smith of Laurel questioned whether a parking agreement referenced in the master developer agreement should have been in place before site plan approval.
Town Attorney Erik Howard said the parking agreement “will be negotiated shortly” and “will be incorporated into the approval” when it is completed.
John McAuliff of Riverhead said the hotel would hurt nearby businesses whose customers already have a hard time finding parking.
Council Member Joann Waski said the emergence of a downtown parking problem is a sign of progress. “It is a good thing that we are turning the page to have a parking problem because it means that what has been happening downtown is working,” she said.
Waski told McAuliff she could “personally assure” him that downtown businesses would not be harmed by the hotel’s parking arrangements.
“I don’t believe that Mr. Petrocelli has any ill intention of hurting any of the businesses,” she said.
Council Member Bob Kern also defended the project as part of downtown’s recovery.
“For a good 15 years, everybody in Riverhead was complaining about the ghost town that downtown was,” Kern said. “Now the ghosts are disappearing and people are coming.”
Martin Sendlewski, chair of the town’s Parking District Advisory Committee, speaking via Zoom, said he supports downtown revitalization but questioned how the town could approve the site plan and special permit before the parking agreement with Petrocelli or even its basic framework was available.
“Parking is certainly one of the most important elements of any successful downtown,” Sendlewski said. “We certainly don’t want to create a problem, especially since the garage is likely years off,” referring to a facility planned for the First Street municipal parking lot.
Ron Hariri of Aquebogue, also on Zoom, criticized the site plan approval as premature due to unresolved parking issues. Hariri called the developer’s decision to exercise its contractual right to delay the closing date beyond July 31 “a red flag” about possible financing or investor issues. The contract allows the purchaser the right to extend the closing date for up to six months.
Jens-Smith urged the board to postpone the vote, arguing that because the project is in an area designated by New York State as a potential environmental justice area, the town must meet public outreach requirements referenced in the Suffolk County Planning Commission’s comments on the application.
“This community deserves a process the law promises,” Jens-Smith said. “I’m asking you to table this vote and come back when the record shows real compliance.”
Howard said the Suffolk County Planning Commission’s statements were comments, not binding conditions. “The town board is not jurisdictionally bound by comments,” he said. “If the town board is inclined to vote on this resolution today, they can vote on the resolution.”
The hotel is part of the broader downtown riverfront redevelopment plan advanced through the town’s master developer agreement with Petrocelli for the Town Square project. The project has evolved from an earlier mixed-use concept that included condominium units on the fifth floor to the current hotel-only proposal.
The approval is subject to a long list of conditions, including final water and sewer district approvals, Suffolk County Department of Health Services approval, stormwater pollution prevention plan approval, Riverhead Fire Marshal permits, final approval of building material samples by the Architectural Review Board and compliance with comments from the town engineer and the town’s Town Square design consultant.
The resolution gives the applicant three years to complete construction and begin the specially permitted hotel use. The site plan approval is valid for 36 months, with the possibility of one 12-month extension by the Town Board.
In its approval Tuesday, the board relied on the town’s prior environmental review of the Riverhead Downtown Revitalization Projects. The Town Board adopted a negative declaration for those projects in March 2025, finding they would not result in significant adverse environmental impacts. A consistency analysis submitted for the hotel application concluded the change from the earlier residential component to a 94-room hotel did not significantly alter the environmental record or require substantial additional review.
The approval comes one day after the Riverhead Industrial Development Agency accepted an amended application from J. Petrocelli Riverhead Town Square LLC for financial assistance for the project.
The IDA application was originally submitted in November 2025 and amended June 12 to reflect the project’s revised hotel-only use. The amended IDA application describes the project as a branded 94-room hotel with multiple retail outlets and first-floor specialty retail, restaurant and food hall or food court space totaling about 8,800 square feet. It estimates total project costs at about $35.1 million.
The IDA resolution does not approve financial assistance. It accepts the amended application for review and authorizes IDA Chairman James Farley to engage Camoin Associates to prepare an absorption and impact study at the applicant’s expense.
The IDA will hold a public hearing before deciding whether to approve financial assistance, but no hearing date has been set. Under the resolution, the public hearing would follow completion of the IDA’s due diligence, including the Camoin study and any other reports or materials the agency requires.
The developer has said it is seeking sales and use tax exemptions, mortgage recording tax exemptions and real property tax abatements through a payment-in-lieu-of-taxes agreement.
According to Petrocelli’s master development agreement with the town, the Riverhead IDA’s approval of financial assistance is integral to the success of the project.
Editor’s note: This is a revised version of the story published at 6 a.m., which been amended for clarity and context.
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